tA 
o 

(P 
IP 


HG 

568 
TRW 


BANCROFT 
LIBRARY 


THE  LIBRARY 

OF 

THE  UNIVERSITY 

OF  CALIFORNIA 


■  -, 


Honest 
Dollars 

By  Prof.  E.  A.  ROSS 


*  /^V->ikA 


cjiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiimiiiiimiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiitiiiiiii 


Are  you  ashamed  of  youi  gaJkar.l  you;ig  IcaJeri1    if  not,  hang  up  his  portrait. 

Free  Silver  riedallion 

RELIEF    PORTRAIT   OF    BRYAN,    SILVER    BACKGROUND,    6    INCHES    IN    DIAM. 

Mailed  to  any  address,  post-paid,  on  receipt  of  40  cts. 

Send  us  30  orders  for  Free  Silver 

fledalllons  at  40  cts.  each,  and 

we   will    present   you    with 

this  life  size  bust  FREE 


LIFE   SIZE    3-4   FACE 


Bust  of  Bryan 


OLD   IVORY   FINISH 
MOUNTED    ON    A     POLISHED     MA- 
HOGANY   PLACQUE 

From  life  by  a  great  artist 

Price  of  Bust  alone  is  $3. 
On  receipt  of  $1.00  zve  zuill 
ship  Bust  by  express,  c.  o.  d. 
If  unsatisfactory  return. 


Make  all  remittances  to 


M.  P.  Frutchey,  Auditorium  Building,  Chicago 


HONEST  DOLLARS 


BY 


EDWARD  A.   ROSS 

Professor  of  Economic  Theory    and    Finance    in    Le land  Stanford,  Jr,, 

University ;   Secretary  of  the  American  Economic  Association^ 

1892-93 


Chicago 
CHARLES  H.  KERR  &  COMPANY 
56  Fifth  Avenue 
1896 


Copyright,  1896 
By  Charles  H.  Kerr  &  Company 


Cnity  Library,  No.  61.  Monthly,  $3.00  per  year.  September, 

Entered  at  the  Postoffice,  Chicago,  as  second-class  matter. 


4-<L 


f  fceNcate  tbis  little  booh  to 
tbtr.feittG  men. 


2  A.  /?«<>. 


HONEST  DOLLARS. 

"But  thou  shalt  have  a  perfect  and  just  weight,  a  perfect  and  just 
measure  shalt  thou  have." — Deuteronomy  xxv.  i  5. 

Money  has  two  functions:  To  be  a  medium  of  ex- 
change and  to  be  a  standard  of  value  in  the  payment 
of  debt.  Money  fulfills  the  first  function  best  when 
all  its  parts  circulate  at  a  parity;  when  its  value  is 
uniform  in  all  parts  of  the  country;  when  it  can  be 
conveniently  handled  in  any  sum;  and  when  it  can 
be  used  in  international  trade.  The  present  money 
of  the  United  States,  composed  of  gold,  of  green- 
backs, and  of  banknotes,  silver  and  silver  certificates, 
kept  at  a  parity  with  gold,  has  all  the  qualities  of  a 
good  medium  of  exchange,  and  nobody  finds  fault 
with  it.  Hut  as  a  standard  of  value  it  shows  the 
gravest  defects;  while  it  is  " sound  money"  it  is  not 
honest  money. 

An  honest  dollar,  like  an  honest  gallon  or  an  hon- 
est yard-stick,  is  simply  a  JUST  STANDARD.  A 
just  measure  of  value  you  get  in  the  same  way  that 
you  get  a  just  measure  of  capacity.  It  makes  no 
dilTerence  how  many  pecks  there  are  in  a  bushel — 
three,  four  or  eight.  If  we  had  an  eight-peck  bushel 
prices  and  transactions  would  adjust  themselves  to  it 
as  they  do  now  to  the   four-peck  bushel.     The  main 


AN   HONEST  DOLLAR  IS 


thing  is,  that  when  you  have  once 
got  a  given  number  of  pecks  in  a 
bushel,  that  you  stick  to  that  num- 
ber. It  is  not  absolute  size,  but 
change,  that  makes  a  bushel  unjust 
and  dishonest.  Likewise  A  JUST 
MEASURE  OF  VALUE  MEANS 
A  MEASURE  THAT  IS  CON- 
STANT, be  there  much  or  little 
value  in  it.  It  must  not  change 
from  time  to  time,  or  somebody 
will  be  cheated. 

But  how  can  you  keep  your  meas 
ure    of  value  constant?     "A    very 
simple  thing,"    I  hear  some  people 
say:  "keep  in  your  dollar  the  same 


number  of  grains  of  metal  and  you  o 
are  sure  to  have  a  constant  measure  n» 

> 

c 


of  value.  If  year  after  year  the 
dollars  are  made  of  the  same  weight 
of  gold  or  silver  the  dollar  will  be 
honest." 

But  is  this  so?  In  the  tower  of 
London  is  kept  a  bar  of  metal 
known  as  the  "standard  yard,"  and 
from  time  to  time  copies  of  this  yard 
are  taken  to  be  used  in  the  custom 
houses  and  elsewhere.  These 
copies  are  taken  in  the  presence  of 
scientific  men,  to  insure  accuracy. 
Now,  suppose    some    day  they  find 


r\ 


mm 


TAKK  VOL  It  CHOICE, 


THE  NOBLEST  WORK  OF  MAN  7 

that  somebody  has  lopped  a  piece  off  the  end  of  this 
bar,  might  not  some  muddle-headed  person  say: 
"True,  the  bar  is  shorter,  but  being  still  of  the  same 
substance  and  thickness,  they  can  safe!}*  neglect 
any  loss  in  length,  and  can  practically  regard  the 
bar  as  the  same."  Would  not  the  answer  be,  that  the 
important  thing  about  this  bar  is  just  its  LENGTH, 
and  not  its  thickness  or  the  material  of  which  it  is 
made  ? 

WHAT  MARKS  A  DOLLAR  HONEST? 

Likewise  an  important  thing  about  a  dollar  is  not 
its  weight  or  substance.  You  tell  me  the  dollar  has 
all  the  time  been  23.2  grains  of  line  gold,  and  my 
•  answer  is:  Well,  what  of  it?  The  important  thing 
about  the  dollar  is  its  VALUE,  and  this  depends 
upon  its  use.  One  man  wants  a  dollar  to  melt  up 
into  rings  or  watch-chains,  in  which  case  you  can 
insure  him  a  constant  value  only  by  keeping  the  same 
quantity  of  metal  in  it.  Hut  this  is  the  one  man  in 
ten  thousand.  Everybody  else  wants  a  dollar  not  to 
melt,  but  to  pass  on — i.  e.,  to  buy  things  with  it. 
That  being  the  case,  it  is  just  as  irrelevant  to  point 
out  that  tlie  dollar  is  year  by  year  of  the  same  weight 
and  metal  as  it  is  to  point  out  that  the  standard  yard 
ill  of  the  same  thickness  and  material.  What  do 
care  for  thickness  or  material  so  long  as  the  yard 
onstant  in  length,  or  for  weight  or  material  so 
g  as  a  dollar  is  constant  in  purchasing  power? 
\s  the  universal  us."  of  a  dollar  is  to  buy  things 
h,    a    constant    measure    of    value    is    a    dollar    of 


8  4N  HONtS T  DOLLAR  IS 

CONSTANT  AND  UNIFORM  PURCHASING 
POWER.  This  means  power  to  purchase  whatever 
we  want — provisions,  fuel,  clothing  or  labor.  If 
from  time  to  time  the  miller  got  fewer  dollars  for  hit 
flour,  the  baker  fewer  dollars  for  his  loaves, the  miner 
fewer  dollars  for  his  coal,  etc.,  we  should  say  that  the 
dollar  has  gained  in  its  purchasing  power.  If,  on  the 
other  hand,  a  man  can  buy  less  clothing  and  furniture, 
or  fewer  shirts  and  car  rides  for  his  dollar,  we  should 
conclude  that  the  dollar  has  decreased  in  its  general 
purchasing  power. 

Just  here  the  question  comes  up:  "  Does  one  article 
count  as  much  as  another?"  If  the  dollar  fetches 
one-half  as  much  wheat  as  formerly,  but  buys  twice 
as  much  indigo,  shall  we  say  that  these  two  balance 
each  other,  and  that  the  dollar  is  the  same  in  pur- 
chasing power?  No.  Because  people  spend  more 
money  for  wheat  than  for  indigo,  and  hence  they  are 
not  compensated  for  the  dearness  of  wheat  by  getting 
twice  as  much  indigo.  It  is,  therefore,  an  honest 
dollar  that  stays  constant  in  its  power  to  purchase  for 
the  average  man.  If  the  average  man  receives  a 
yearly  income  of,  say,  $600  and  that  keeps  him  in 
the  same  condition  of  comfort  from  year  to  year, 
you  have  what  I  call  an  honest  dollar. 

PURCHASING  POWER  AND  PRICE. 

Nobody  ever  quotes  purchasing  power,  but  w# 
all  know  about  prices.  What,  now,  is  the  relation 
of  purchasing  power  to  price? 

Purchasing    power    and    price    are    THE  SAME 


THE  NOBLEST  WORK  OF  MAN 


THING,  seen  from  different  sides.  In  comparing 
a  boy  to  a  man,  in  respect  to  weight,  we  can  say 
that  the  man  weighs  three  times  as  much  as  the  boy, 


or  that  the  boy  weighs  one-third  as  much  as  the  man. 

I  either  case  we  have  a  ratio  which  is  the  same — 
mely,  3  to  1.  Now,  purchasing  power  means  the 
wer  of  the  dollar  over  goods;  price  means  the 
power  of  the  goods  over  the  dollar.  We  can  say 
that  the  price  of  a  hat  is  $3,  or  that  the  purchasing 
power  of  the  dollar  is  one-third  of  the  hat.      In  both 


10  AN  HONEST  DOLLAR  IS 

cases  we  are  simply  expressing  the  exchange  ratio 
of  dollars  to  hats — namely,  3  to  1.  It  is  clear,  then, 
that  as  purchasing  power  goes  down  price  goes  up; 
or,  as  price  goes  down  purchasing  power  goes  up. 
If  purchasing  power  is  constant,  so  are  prices. 
Therefore,  to  obtain  honest  dollars  you  must  have  a 
UNIFORM  LEVEL  OF  PRICES. 

Right  here  comes  the  fallacy  that  meets  us  every- 
where. Scores  of  times  you  hear  it  said:  "  We  must 
have  the  best  dollar,  the  dollar  that  will  buy  the 
most.*'  "Nothing  but  the  best  dollar  will  do  for  the 
American  farmer  and  workingman."  This  sounds 
very  noble  and  inspiring,  doesn't  it?  We  Americans 
do  want  the  best  shoes  and  the  best  shirts  and  the 
best  food,  and  will  not  put  up  with  the  food  that  will 
do  for  the  Mexican  peon  or  the  Chinese  coolie.  So 
likewise  we  must  have  "big  dollars  that  will  go 
farther  and  farther.''  Now,  just  translate  this  phrase, 
"best  dollar.'-  Do  we  want  the  longest  yard-stick  or 
the  heaviest  pound  ?  Is  a  five-quart  gallon  better  than 
one  of  four  quarts?  Is  a  forty-inch  yard-stick  better 
than  a  thirty-six-inch  yard?  Of  course  not.  The 
best  yard,  the  best  pound,  the  best  gallon  is  one  that 
does  not  vary,  that  will  not  cheat  us;  and  THE 
BEST  DOLLAR  is  not  the  heaviest  dollar  or  the 
dollar  that  goes  farther  and  farther  year  by  year,  but 
simply  THE  JUSTEST  DOLLAR.  Imagine  a 
farmer  who  is  selling  his  load  of  potatoes  exclaim- 
ing: "Hold  on,  there!  Are  you  going  to  measure 
my  potatoes  with  a  measly  four-peck  bushel?  That 
may  do  for  the  European  peasants,  but  for  an  Ameri- 


i 


THE  NOBLEST  WORK  OF  MAN 


11 


can  farmer  like  me  nothing  but  the  biggest  kind  of 
a  bushel  will  do.  I  am  going  to  measure  these  pota- 
toes in  an  eight-peck  bushel!"  -Away,  then,  with 
the  solemn  cant  about  the  "best  dollar!" 

NUMBER  CUTS  A  FIGURE  IN  MEASURING  VALUE. 

We  have  now  to  note  a  difference  between  a  meas- 
ure of  value  and  other  measures.  You  put  before  a 
boy  a  foot  rule 
and  a  board  and 
he  can  compare 
them  and  tell  you 
there  are  ten  foot- 
lengths  in  a 
board,  but  if  you 
put  $i  alongside 
the  board  and  ask  ten  feet  long. 

him  to  compare  the  $i  and  the  board,  can  he  do  it? 
Could  you,  if  you  had  no  knowledge  of  the  lumber 
Take    the    value    of,  a   horse  measured  in 


market? 

dollars. 


Suppose  the  number  of  dollars  in  a  country 
be  doubled,  will  that 
affect  the  price  of  the 
animal?  Suppose  the 
number  of  the  horses 
be  doubled,  will  that 
disturb  the  exchange 
notes  between  dollars 
and  horses?  Certain- 
ly. On  the  other  hand, 
docs  the  number  of 
foot    rules     and    half- 


WHATSI.I  MI'.KK    W.iKTJM 


1 2  AN  HONEST  DOLLAR  IS 

bushels  in  any  way  affect  the  number  of  inches  in  a 
board  or  of  bushels  in  a  bin?  Certainly  not.  In  fact, 
when  we  compare  things,  not  in  respect  to  their  own 
qualities,  such  as  length  or  weight,  but  in  respect  to 
relative  value,we  always  find  the  LAW  OF  SUPPLY 
AND  DEMAND  governing.  You  can  readily  com- 
pare a  basket  of  potatoes  and  a  basket  of  peaches  in 
respect  to  weight,  but  when  you  want  to  compare 
them  in  respect  to  value  you  have  got  to  take  into 
account  the  crop  or  supply  of  each  and  the  demand 
for  each.  The  law  of  supply  and  demand  governs  the 
exchange  ratio  of  hats  and  caps,  of  coal  and  cord- 
wood,  of  copper  and  steel,  and  likewise  of  dollars  and 
goods — i.  e.,  it  controls  price  and  purchasing  power. 

Often  you  hear  it  said:  "There  are  already  enough 
dollars  to  do  the  business  of  the  country  and  to  meas- 
ure the  value  of  its  products.  To  make  a  lot  more 
dollars  would  be  as  silly  as  to  double  the  number  of 
bushel  baskets  or  of  yard-sticks."  But  if  what  I  have 
just  said  is  true,  the  number  of  dollars  has  A  GOOD 
DEAL  to  do  with  the  honesty  of  the  dollar,  while 
the  number  of  yard-sticks  has  nothing  to  do  with  the 
honesty  of  the  yard-stick. 

The  prices  in  a  country,  therefore,  depend  uport 
the  demand  and  supply  of  dollars,  or,  better  yet,  upon 
the  demand  and  supply  of  MONEY  WORK.  The 
more  rapidly  the  dollars  go  from  hand  to  hand  the 
more  work  they  do,  just  as  the  more  trips  the  loco- 
motive makes  the  greater  its  "duty."  The  supply  of 
money  work  depends  upon  two  factors — upon  the 
number  of  dollars  and  upon  the  average  rapidity  of 


THE  NOBLEST  WORK  OF  MAN  13 

circulation.  If  dollars  passed  from  hand  to  hand 
twice  a  week  instead  of  once  a  week  the  effect  would 
be  the  same  as  doubling  the  number.  Now  the  de- 
mand for  money  work  depends  upon  four  chief  fac- 
tors. There  is,  first,  the  quantity  of  wealth.  Other 
things  remaining  the  same,  the  more  wealth  to  be  ex- 
changed the  lower  the  range  of  prices.  Then  the 
more  hands  this  wealth  passes  through  on  its  way  to 
the  consumer  the  more  business, and  hence  the  greater 
need  of  money.  The  need  is  lessened,  on  the  other 
hand,  by  a  resort  to  barter  and  by  the  use  of  credit. 
Number  and  efficiency  of  dollars,  quantity  of  wealth, 
number  of  exchanges,  use  of  barter,  use  of  credit — 
these,  then,  are  the  SIX  FACTORS  in  determining 
the  level  of  prices. 

SHOULD  WE  TRY  FOR  THE  HONEST  DOLLAR? 

Is  the  government  under  any  obligation  to  guar- 
antee an  honest  dollar?  We  find  that  all  civilized 
governments  feel  under  obligation  to  guarantee  the 
yard-stick,  pound  or  gallon,  and  one  found  using  a 
measure  different  from  the  legal  pattern  can  be  pun- 
ished. Thousands  of  dollars  have  been  spent  in  send- 
ing men  to  find  the  length  of  a  degree  on  the  earth's 
surface  in  order  to  derive  from  it  a  scientific  system 
of  measures.  If  the  government  undertakes  to  guar- 
antee measures  of  weight  or  capacity,  how  much 
more    i-    it    bound    to    guarantee    an    honest  dollar! 

Granting  this  obligation,  how  is  it  to  be  discharged? 
HOW  SHALL  THE  GOVERNMENT  GO 
VBOUT    IT    TO     MAINTAIN    AN     HONEST 

COLLAR?      Why,    simply    by    controlling    SOME 


1 4  AN  HONES  T  DOL  LAR 

ONE  of  the  six  factors   that  control  the  price  level. 

Let  us  take  them  up  separately.  In  the  first  place, 
the  government  cannot  control  the  quantity  of  wealth 
to  be  exchanged,  nor  can  it  control  the  number  of 
transactions  each  article  gives  rise  to.  It  cannot 
govern  the  use  of  barter,  nor  can  it  determine  the 
extent  to  which  men  shall  resort  to  credit.  In  fact, 
to  maintain  a  price  level  by  altering  the  demand  for 
money  work  to  suit  the  existing  supply  would  be  as 
absurd  as  paring  a  boy's  feet  down  to  fit  his  shoes 
instead  of  stretching  the  shoes  to  fit  the  boy's  feet. 
There  yet  remain  the  two  factors  of  supply — number 
of  dollars  and  the  rapidity  of  circulation.  Can  the 
government  control  the  latter?  No.  Can  the  govern- 
ment control  the  former?  Yes.  The  government 
can  certainly  affect  the  number  of  dollars — i.  e.,  the 
volume  of  lawful  money  in  the  country.  The  ways 
in  which  this  may  be  done  I  shall  speak  of  next. 

I  have  defined  an  honest  dollar  and  shown  how 
government  may  secure  it.  I  now  ask  the  question: 
Is  the  maintaining  of  an  honest  dollar  a  serious  mat- 
ter? This  calls  us  to  consider  some  of  the  conse- 
quences of  dishonest  dollars.  If  two  men  agree  to  a 
contract,  and  between  the  time  of  making  and  the 
time  of  fulfilling  the  contract  any  change  takes  place 
in  the  legal  acceptation  of  the  terms  used,  or  of  the 
units  of  measure  mentioned  in  the  contract,  one  party 
or  the  other  is  cheated.  Suppose  you  rented  two 
farms,  one  for  so  many  bushels  of  wheat,  the  other 
for  so  many  dollars.  But  official  standards  are 
changed ;   when  you  come   to   settle  you  have  to  pay 


I 


THE  NOBL  ES  T  WORK  OF  MAN  1 7 

one  landlord  with  five  peck  bushels  and  the  other 
with  125-cent  dollars.  Is  there  any  difference  here 
in  the  degree  of  the  wrong?  If  tons  are  called  for 
and  the  law  adopts  a  new  2,500-pound  ton;  if  gallons 
are  called  for  and  the  live  quart  gallon  is  legalized; 
if  dollars  are  called  for  and  the  law  exacts  a  dollar 
with  125  cents  of  purchasing  power  in  it,  THE 
WRONG  IS  THE  SAME.  Now,  contracts  of  future 
delivery  of  gallons  or  yards  are  not  so  very  common  ; 
on  the  other  hand,  contracts  for  the  future  delivery 
of  dollars  are  legion.  They  include  every  species  of 
debt — promissory  notes,  bonds,  drafts,  book  accounts, 
etc.  Every  man  who  borrows  money  promises  to  de- 
liver so  many  dollars  in  the  future,  and  if  he  can  re- 
pay with  little  fifty-cent  dollars  he  cheats  his  creditor, 
while  if  he  must  pay  big  200-cent  dollars  the  creditor 
defrauds  him.  One  is  just  as  bad  as  the  other,  but  I 
shall  trace  the  consequences  of  the  latter  because  it 
hits  our  situation  JUST  NOW. 

FORGERY  AND  SOUND  FINANCE. 

I  can  see  no  difference  in  amount  of  wrong  be- 
n  your  forcing  your  debtor  to  repay  you  dollars 
that  would  go  twice  as  far  and  are  twice  as  hard  to 
get  as  the  dollars  you  lent  him,  and  your  raising  the 
of  the  note  to  double  its  value  by  the  use  of 
chemicals.  The  wrong  is  the  same.  But  when  an 
individual  does  it,  it  is  FORGERY;  when  a  nation 
does  it,  it  is  "SOUND   FINANCE/1 

Not  only  are  all  debtors  injured  by  big,  fat  dollars, 
but,  in  fact,  all  people  who  have  property.   You  save 


18  y4N  HONEST  DOLLAR  IS 

your  money  and  you  put  your  savings  into  a  $3,000 
house,  but  the  dollar  changes  in  buying  power. 
Your  house  will  become  worth  only  $2,500  or  $2,- 
000.  For  if  money  is  getting  the  "ups"  property  is 
getting  the  "downs.''  On  the  other  hand,  the  man 
who  has  money  does  not  have  to  lend  it  in  order  to 
get  the  creditor's  premium.  If  his  money  lies  idle  in 
the  bank  vault  or  buried  in  the  ground  it  will  still 
bring  him  an  undeserved  increase  when  he  comes 
to  buy  with  it. 

We  seem  to  have  on  the  one  hand  debtors  and 
roperty-owners  and  on  the  other  hand  those  who 
hold  money  or  claims  for  money.  But  think  a  little 
further.  Who  are  the  people  who  hold  money  or 
simply  claims  for  money?  Why,  those  who  enjoy 
accumulations,  whether  their  own  or  their  parents', 
and  are  no  longer  engaged  in  production — those  who 
have  made  their  "pile"  and  retired.  And  who  are 
the  people  injured?  Why,  simply  the  actual  pro- 
ducers who  are  offering  their  product  of  hand  and 
brain  in  the  market  for  money.  The  manufacturer, 
the  farmer,  the  workingman,  the  miner,  the  lumber- 
man—THOSE  WHO  DO  THE  WORLD'S 
WORK — must  accept  less,  while  the  holders  of  past 
accumulations,  producing  nothing  and  therefore  hav- 
ing nothing  to  sell,  get  more.  Of  course  some  of  us 
belong  to  both  classes  and  are  pulled  different  ways, 
but  if  you  run  the  line  between  interests,  rather  than 
between  men,  it  will  lie,  as  I  have  said,  between  the 
past  and  the  present. 


THE  NOBLEST  WORK  OF  MAN  19 

THE  BENEFIT  OF  IMPROVEMENTS  SHOULD    GO  TO  THE 
PRODUCER. 

We  must  now  take  up  an  objection,  which,  if  not 
met,  undermines  our  whole  reasoning  as  to  what  con. 
stitutes  an  honest  dollar.  uIs  it  true,"  say  the  gold 
men,  "that  prices  must  always  run  along  on  a  level? 
When  the  quantity  of  labor  necessary  for  the  produc- 
tion of  articles  is  all  the  time  declining;  when  steel 
rails,  farm  machinery, water  power,  cheaper  coal  and 
better  methods  are  making  it  easier,  year  by  year, 
to  move  a  carload  of  goods, to  raise  a  bushel  of  wheat, 
clean  a  bale  of  cotton  or  weave  a  yard  of  cloth, ought 
not  the  price  of  goods  to  fall  with  their  falling  cost  of 
production?  Cheap  production  calls  for  cheap  goods. 
This  does  not  mean  lower  wages  or  income,  because 
if  products  sell  for  less,  they  have,  on  the  other  hand, 
more  products  to  sell.  Let  the  money  income  of  the 
producer  keep  along  a  level,  while  the  price  of  his 
product  sinks  with  its  declining  labor  cost."  Let  us 
pick  this  to  pieces  and  show  the  worm  of  fallacy 
coiled  up  in  the  heart  of  it. 

In  the  first  place  the  gold  man  juggles  with  the 
word  u cheap."  He  first  shows  that  the  goods  are 
--etting  cheap — i.e.,  that  they  require  less  and  less 
human  labor  to  produce  them.  Then  he  argues  that, 
matter  of  course,  they  will  in  consequence  get 
cheaf — i.e.,  exchange  for  less  money.  Now  the  rela- 
tion of  labor  to  goods  has  absolutely  nothing  to  do 
with  the  relation  of  money  to  goods.  If  the  latter 
relation — i.  e.,  price — must  follow  the  other,  we 
should  like  to  be  shown  WHY. 


20  AN  HONEST  DOLLAR  IS 

It  is  true  that  year  by  year  human  labor  is  getting 
more  and  more  effective, owing  to  industrial  progress, 
and  that  there  is  thus  an  increase  of  product  that 
must  go  to  somebody.  But  I  know  of  no  one  who 
has  so  good  a  right  to  this  extra  product  as  the  man 
who  produces  it.  Though  possibly  he  did  not  dis- 
cover the  new  and  better  way  of  applying  his  labor, 
it  is,  after  all,  HIS  labor  that  becomes  more  produc- 
tive, and  to  HIM  ought  the  premium  to  go.  Now, 
the  above  proposal  means  nothing  less  than  that  the 
present  producer,  who  uses  borrowed  capital,  shall 
not  enjoy  this  increase,  but  shall  render  it  to  the 
PAST  PRODUCER. 

I  will  make  this  clear.  Twenty  years  ago  Jones 
sold  you  for  $500  a  lot  he  had  bought  for  $50,  thus 
clearing  $450  on  the  turn-over.  You  hold  it  until  it 
is  worth  $2,000,  when  along  comes  Jones  and  wants 
to  buy  it  back.  Moreover,  he  tells  you  he  would 
like  to  have  it  without  paying  the  $1,500  the  lot  has 
gained  in  value  since  you  bought  it  of  him.  He  tells 
you  it  is  "unearned  increment,"  and  asks  what  right 
you  have  to  demand  it.  He  points  out  that  you  did 
not  earn  it,  but  that  it  came  because  you  sat  and 
waited.  What  would  you  say  to  this  cool  proposi- 
tion? Something  like  this,  I  think:  uYes,  it  is  true 
that  the  $1,500  is  an  unearned  premium,  but  please 
to  notice  that  it  accrued  on  the  lot  while  I  owned  it, 
and  not  when  you  held  it.  You  got  $450  of  increase 
when  the  lot  was  yours,  and  now  you  want  to  gobble 
mine,  too.  You  want  both  premiums,  leaving  me 
none," 


THE  NOBLEST  WORK  OF  MAN  21 

Carry  this  analysis  a  little  further.  Brown,  a  car- 
penter, lends  me  a  table,  for  which  I  pay  a  yearly- 
rent.  At  the  end  of  ten  years  I  bring  back  the  table 
uninjured,  but  he  says:  "Do  you  know  it  takes  only 
one-half  as  much  labor  to  make  a  table  to-day  as  it 
did  when  I  lent  you  that  table?  I  want  you  to  return 
me  two  tables."  To  that  I  would  naturally  say: 
"You  loaned  me  a  table — one  table — here  it  is."  But 
suppose  Brown's  table  got  burned,  and  I  am  return- 
ing to  him,  not  his  own  table,  but  a  new  one,  exactly 
as  good  in  every  respect.  Will  it  stagger  me  for  him 
to  point  out  that  the  new  table  was  easier  to  make 
than  his  had  been?  Not  at  all.  I  should  say:  "That 
my  ability  to  make  a  table  is  twice  what  it  was  when 
I  borrowed  of  you  is  my  affair,  not  yours.  You  got 
the  current  increase  in  ability  when  you  were  in  the 
table  manufacturing,  didn't  you?" 

Take  now  a  money  loan.  Robinson  began  farm- 
ing in  Iowa  in  1850,  and,  had  conditions  remained 
constant, he  would  have  accumulated  $5,000  by  1870. 
But  all  the  while  he  was  working, other  fellows  were 
inventing  new  machines  or  finding  out  new  wrinkles 
in  farming,  and  Robinson  was  getting  the  benefit. 
So  by  1870  he  had  got  ahead,  not  $5,000,  but  $10,- 
000.  Now  he  lends  that  $10,000  to  you  and  retires  on 
the  interest.  And  while  you  were  farming  new  im- 
plements are  invented  and  new  ways  of  tilling  the 
soil  are  discovered,  so  that  in  1890  you  find  that  your 
Work  will  turn  off  twice  as  much  in  a  year  as  when 
began.      Well,  you  go  around   and  offer  Robin- 

in  his  principal    in    dollars    that    represent    just    as 


22  AN  HONEST  DOLLAR  IS 

much  farm  product  as  did  the  dollars  Robinson  lent  to 
you.  -But  this  cantankerous  Robinson  says:  "These 
are  not  honest  dollars.  I  want  dollars  that  represent 
double  the  quantity  of  farm  produce,  because  it  is 
easier  for  you  to  raise  wheat  than  it  was  for  me,  and 
your  day's  work  will  go  twice  as  far."  What  would 
you  sa}7  ?  I  should  say:  "That  may  be  true,  but  you 
had  the  current  improvement  in  production  while 
you  were  farming,  and  I  want  the  same  while  I  am 
farming.  After  all,  it  is  my  labor  and  not  yours  that 
has  doubled  in  productiveness." 

SHOULD  THE  MONEY-LENDER  SKIM  OFF  THE  CREAM? 

Now,  the  creditor  who  says  you  must  pay  him 
dollars  representing  the  same  quantity  of  labor  as 
when  you  made  the  loan  is,  in  fact,  asking  you  to 
surrender  to  him  the  fruit  of  industrial  progress — viz., 
the  premium  on  your  labor.  It  is  perfectly  true  that 
we  participate  in  the  progress  of  the  age,  whether 
or  not  we  have  done  anything  to  bring  it  about.  But 
I  say  that  the  benefit  ought  to  accrue  to  THIS  gen- 
eration, and  not  to  a  PAST  generation.  And  if  the 
debtors  surrender  to  their  creditors  the  premiums 
that  come  from  improvements  in  technique  and  ma- 
chinery, they  are  practically  giving  up  to  others 
something  that  has  accrued  on  their  own  machinery 
and  their  own  brains.  I  insist  that  the  honest  dollar 
must  be  CONSTANT  IN  BUYING  POWER. 
You  can  have  a  currency  that  shall  keep  labor  uni- 
form in  reward,  while  the  products  of  labor  are  fall- 
ing in  price  because   it   takes   less   and   less  labor  to 


THE  NOBLEST  WORK  OF  MAN 


•i:\ 


produce  them, or  you  can 

have    one    under    which 

commodities  are  uniform 

in  price  and  labor  rising. 

In  the  former    case    you 

transfer  the  progress  from 

present  to  past  producers. 

You  ask  that  the  man  who 

produced      before      1873 

shall  have   the   premium,, 

not  only     of  his  genera- 
tion, but  also  of  this  one. 

You  want  two  premiums 

for  him  and  none  for  us. 

There  is  a  tale   of   a   Greek  athlete  who  began  by 

carrying  a  calf  around  the  arena  every  day.     As  the 

calf  grew    his   strength    grew   also,  till  when  the  calf 

had  become   an    ox    he    was  still  able  to  shoulder  it. 

The  gold  men    think    that    by    help  of  inventions  or 

improvements    the  manufacturer    or  farmer  will    be 

able  to  stand  the  apprecia- 
tion of  the  debt  on  his  shoul- 
ders. But  they  are  wrong. 
Apart  from  its  injustice,  he 
cannot  do  it.  His  strength 
grozvs,but  his  burden  grows 
still  faster. 

IS  OUR  DOLLAR  HONEST  ? 

The   vital    question    now 
arises:      Have     we    at    th  »• 


24  AN  HONEST  DOLLAR  IS 

present  time  an  honest  dollar  or  have   we   not?     We 

can  find  this  out  only  by  looking  at  the  actual  course 

of  prices.      In  England  the  eminent  statistician,  Mr. 

Sauerbeck,  has   worked   out   the   prices  of  forty-five 

staple  articles  for  a  long  series  of  years.    Taking  the 

prices  of  1873  as  100,  the  prices  since  then   have  run 

as  follows: 

Gold  prices 
according  to 

Sauerbeck's         Gold  price 
index  numbers.        of  silver. 

1874 102  95.8 

1875 90  93.3 

1  870 95  86.7 

1877 04  90.2 

1878 87  86.4 

1 870 8:i  84.2 

1880 88  85.9 

1881 ...    85  85.0 

1882 84  84.9 

1883 82  83.1 

1884 70  83.3 

1885 72  79.9 

1880 00  74.0 

1887 08  73  3 

1888 70  70.4 

1889    72  70.2 

1890 72  78.4 

1891 ...72  74.1 

1892 68  65.4 

1893 68  58.6 

1894 63  47.6 

1895 02  49.0 

Here  is  a  diagram  showing  the  appreciation  in 
purchasing  power  of  gold,  calculated  from  Doctor 
Soetbeer's  index  numbers,  based  on  100  articles  in 
the  market  at  Hamburg,  Germany,  and  14  articles 
in  the  London  market.  The  dotted  line  shows  the 
increase  and  decrease  in  the  purchasing  power  of 
silver.      Its  slight  oscillations  show  that,  as  compared 


THE  NOBLEST  WORK  OF  MAN 


25 


with    commodities,   silver   has   not  depreciated,  and 
brings  into  marked  contrast  the  appreciation  of  gold. 


Fluctuations  In  the  value  of  Cold  denoted  thus. 
Silver       " 


If  the  index  numbers  were  computed  to  this  year 
we  should  see  the  gold  line  soaring  far  above  the  top 
of  the  diagram. 

There  is  no  getting  around  the  conclusion  that  in 
gold-standard  countries  the  fall  of  prices  in  the  last 
twenty-three  years  has  been  about  40  per  cent.  Sixty 
dollars  will  go  as  far  as  $100  formerly  would — i.  e., 


26  AN  HONEST  DOLLAR  IS 

ihj  purchasing  power  of  gold  has  increased  66f  per 
cent.  If  this  appreciation  were  uniform  it  would  be 
equivalent  to  an  annual  increase  in  the  value  of  the 
unit  of  about  n\  per  cent.  Of  course  the  movement  has 
not  been  at  all  regular.  In  periods  of  prosperity  prices 
have  run  along  on  a  level,  only  to  crash  down  sud- 
denly when  a  commercial  crisis  arrived.  It  is  there- 
fore fair  to  assume  that  as  the  gold  standard  has 
behaved  in  the  past  so  will  it  behave  in  the  future, 
that  if  gold  has  got  on  an  average  2-£  per  cent  more 
valuable  year  by  year  since  the  world  passed  to  the 
gold  standard  it  will  CONTINUE  TO  APPRECI- 
ATE 2i  per  cent  a  year  in  the  future. 

In  the  United  States  the  course  of  prices  has  not  so 
clearly  revealed  the  viciousness  of  the  gold  standard, 
because,  under  the  Bland  and  Sherman  acts,  we 
pumped  silver  into  our  currency  from  1878  to  1893, 
and  by  thus  avoiding  the  European  scramble  for 
gold,  eased  the  downward  pressure  on  our  prices. 
The  index  numbers  of  the  Senate  Finance  Committee 
of  1892  show,  however,  the  following  course  of 
prices  (the  prices  of  i860  being  taken  as  100):* 


1873.... 

1874 

1875 

....137 

133 

127 

118 

Ill 

101 

9(5 

1880 

1881 

1882  .... 

1883 

1884 

1885 

106 

105 

108 

107 

99 

.  93 

1887 

1888 

1889 

92 

94 

94 

1376 

1877 

1890 

1891 

92 

92 

1878 

1879 

1880 

92 

*  The  gold  men  insist  on  calculating  from  i860,  in  order  to  represent 
prices  as  a  great  wave  rising  from  i860  to  1873,  falling  from  1873  to 
now.  By  this  device  they  make  the  fall  in  prices  to  be  about  15  per 
cent  instead  of  40  per  cent.  But  why  start  with  i860?  The  prices 
from  i860  to  1873  are  ancient  history — so  to  a  less  extent  are  the 
prices  from  1873  to  1880.  We  calculate  from  1873  not  in  order  to 
get  back  to  that  level,  but  because  that  was  the  beginning  of  the  single 
gold  standard  for  the  leading  nations. 


THE  NOBLEST  WORK  OF  MAN  27 

Since  the  repeal  of  the  Sherman  Silver  Purchase 
Act  our  currency,  like  that  of  Europe,  has  grown 
only  by  the  annual  mintage  of  gold,  so  whatever  the 
single  standard  has  done  for  Europe  will  appear  in 
our  experience  since  that  date.  We  have  no  general 
price  tables  for  the  last  five  years,  but  the  following 
tables  taken  from  the  Statistical  Abstract  of  the 
United   States  may  give  us  a  hint  of  what  to  expect. 

Wheat.    Corn.    Oats 
1890.  Av.  value  per  bu.  in  cents 0.83.8       5u.o       4:3.4 

1891 83.9  40.6  31.5 

1892 62.4  39.4  31.7 

1893 5&8  3(1.5  29.4 

1894   49.1  4:,.7  32.4 

i 895  50.9  2(5.4  19.9 

Total  value  of  all  farm  animals  in  millions  of  dol- 
lars: 

1891 $2,329       1894 $2,170 

IK92 2,44)1       1N9."> 1,819 

1 893 2,483      1890 1,727 

Although  the  cotton  crop  has  increased  16  per 
cent,  its  value  to  the  producer  has   fallen  as  follows: 

1891 1350,000,000   1894 $201,000,000 

313,000,000   1895 202,000,000 

268,000,000 

Scientists  show  us  that  if  heat  be  applied  very 
gradually  a  frog  can  be  boiled  without  his  knowing 
it.  Any  sudden  rise  of  temperature,  however,  will 
■e  the  frog  to  grasp  the  situation  and  jump  out. 
The  strangulation  of  the  American  producer  by  fall- 
ing prices  was  proceeding  so  gradually  that  he  prob- 
ably would  never  have  become  aware  of  it  had  it  not 


28 


AN  HONEST  DOLLAR  IS 


been  for  the  sudden  jolt  of  1893.  The  cave-in  of 
prices  since  then  has  betrayed  the  operation,  and  he 
now,  Jike  the  frog  when  heat  was  suddenly  applied, 
seems  bent  on  saving  himself  by  a  vigorous  kick. 


1873  TO  1892. 

COST  OF  THE  GOLD  STANDARD. 

The  census  of  1890  shows  that  the  farmers  of  the 
country  groan  under  a  mortgage  and  lien  debt  of 
$1,935,000,000.  With  the  present  standard  they 
must  expect  tha«t  burden  to  increase  about  $48,000,000 
every  year — i.  e.,  for  every   year    the   debt  runs  an 


THE  NOBLEST  WORK  OF  MAN 


29 


extra  $48,000,000  worth  of  farm  products  will  have 
to  be  sacrificed  in  order  to  overcome  the  annual  in- 
crease in  the  difficulty   of    getting    dollars    to   repay 


with.  Besides  this,  an  extra  $5,800,000  of  produce 
will  he  needed  to  meet  the  annual  increase  in  the  in- 
terest burden.  Think  how  many  patches  must  be 
put  on  clothing,  how  many  dresses  must  be  made 
over,  how  many  toes  must  go  cold,  how  many  farm- 


80  AN  HONEST  DOLLAR  IS 

ers'  wives  go  insane,  in  order  to  raise  that  more  than 
$53,000,000  wrung  out  of  the  farmer  by  the  gold 
standard.  American  railroads  are  bonded  for  about 
$5,600,000,000,  so  that  every  year  $140,000,000 
worth  of  freight  and  passenger  business  earns  for  the 
bondholder,  and  not  for  the  owners.  Our  public  in- 
debtedness is  over  $2,000,000,000,  so  that  about  $50,- 
000,000  represents  the  annual  increase  in  the  amount 
of  the  burden  on  the  tax  payers.  I  cannot  take  up 
the  other  items  of  debt,  but  the  whole  of  it  comes  to 
$20,227,000,000.  The  gold  standard  means  that 
this  two-sevenths  of  our  total  wealth  is  loaned  out 
and  earning  for  its  owner  besides  his  legitimate 
interest  an  unseen  illegitimate  interest  of  i\  per 
cent.  And  yet  speak  not  our  statute  books  of 
USURY!  This  $500,000,000,  together  with  the 
yearly  increase  in  the  weight  of  the  interest  burden, 
gives  a  total  of  $529,000,000  affected  by  the 
annual  dishonesty  of  the  gold  standard.  Of  course 
some  individuals  are  both  debtors  and  creditors  and 
the  2|  per  cent, appearing  on  both  sides  of  the  ledger, 
is  canceled.  If  this  applies  to  one-eighth  of  the  whole, 
we  have  left  an  average  of  $460,000,000  worth  of 
property  that  will,  year  by  year,  be  unjustly  trans- 
ferred from  the  hands  of  its  producers  into  the  coffers 
of  the  creditors.  Such  is  the  bill  we  are  paying  for 
the  luxury  of  the  gold  standard.  Is  it  worth  the 
cost?  Must  we  go  on  "climbing  up  the  golden 
stairs"  with  this  enormous  burden  of  debt  piled  on 
our  backs  and  getting  heavier  every  step  we  take? 
This,  then,  is  the  size  of  the  silver  question,  so  far 


THE  NOBLEST  WORK  OF  MAN 


31 


as  it  is  a  question  of  JUSTICE.  Keep  the  gold  stand- 
ard, and  we  impose  upon  the  producing  part  of  the 
people  an  anual  tax  that  is  more  than  one-half  of  the 
revenue  of  the  federal,  state,  city,  county  and  town- 
ship governments  of  the  United  States. 


gipysiBjBgnniiErgiTr; — . — 


m 


•MT GOODNESS!  HAVE  1  0OT  ALL  THIS 
AHEAD  OF  ME!  I  THOUGHT  I  WAS  TO  THE 
Top." 

Think  of  it,    producers; 

the  gold  men  have  strapped 
^^^  upon  you  a  yearly  tax  that 

is  FOUR  TIMES  the 
cost  of  the  German  standing  army!  This  army 
numbers  480,000  men.  And  yet  you  brag  that  we 
have  no  standing  army  in  this  country! 

DISHONEST    DOLLARS  AND  HARD  TIMKS. 

But  this  is  a  question  of  PROSPERITY  as  well 
as  a  question  of  justice.  It  is  not  hard  to  show  that 
falling    prices    injure    the    productive    power  of  the 


32  AN  HONEST  DOLLAR  IS 

country  and  lead  to  economic  waste.  The  modern 
business  man  makes  heavy  outlay  for  land  or  ma™ 
chinery  or  labor  or  raw  material,  months,  or  even 
years,  before  the  sale  of  the  finished  product,  from 
which  alone  these  costs  can  be  recovered.  He  ven- 
tures this  outlay,  assuming  that  the  price  of  the  prod- 
uct will  continue  in  the  future  much  as  it  has  been 
in  the  past,  unless  some  special  factor  enters  in.  But 
under  a  regime  of  falling  prices  his  calculation  always 
fails,  for  the  proceeds  of  the  product  do  not  suffice  to 
cover  costs  and  leave  a  profit.  If  the  downward 
tendency  is  strong,  not  only  does  the  business  man 
fail  of  his  profit,  but  he  may  be  gradually  impairing 
his  capital  by  having  to  market  goods  at  less  than 
their  actual  cost.  If  he  has  had  to  borrow  part  of  his 
capital,  as  most  businessmen  do,  the  shrinking  of  the 
value  of  his  establishment  wipes  out  his  own  invest- 
ment of  capital,  and  it  falls  into  the  maw  of  the 
lender.  FALLING  PRICES,  THEREFORE, 
DECREASE  THE  CHANCE  OF  SUCCESS  IN 
BUSINESS  by  introducing  an  unlooked-for  element 
which  upsets  all  the  well-laid  plans  of  merchant  or 
manufacturer.  The  commercial  death  rate  is  higher 
than  it  ought  to  be.  Just  as  the  bankruptcy  rate 
during  the  panic  year  of  1893  rose  from  1  per  cent 
of  all  enterprises  to  ii  per  cent,  so  an  era  of  falling 
prices,  taken  as  a  whole,  shows  too  high  a  percentage 
of  failures.  For  six  years  before  1873  business  failures 
averaged  3,000;  for  six  years  after,  8,000;  since  1888 
they  have  stayed  above  10,000,  rising  in  1893  to  15,- 
000.    This  means  a  collapse  of  industrial  machinery, 


THE  NOBLEST  WORK  OF  MAN  33 

a  smashing  of  enterprises.  The  result  is  that  just 
so  many  more  new  enterprises  must  be  started  in 
order  to  keep  up  production.  A  part  of  our  energy, 
therefore,  is  used  up  in  creating  enterprises  that  ought 
to  be  devoted  to  running  enterprises. 

The  collapse  of  business  is  a  serious  thing..  In 
1893  there  was  as  much  arable  land,  as  many  farms, 
shops,  mills,  furnaces  and  railroads,  as  many  tools, 
machines,  engines  and  dynamos,  as  much  muscle, 
skill,  talent  and  ambition  as  the  3'ear  before.  Yet 
there  was  an  industrial  paralysis  leading  to  a  great 
falling  ofl  in  production.  On  all  sides  were  seen  un- 
employed labor,  idle  machinery,  smokeless  chimneys, 
rusting  side-tracks  and  empty  stores.  What  was 
the  trouble?  Nothing  more  or  less  than  the  fact  that 
many  of  the  enterprises  by  which  the  productive 
powers  of  the  nation  are  kept  employed  had  collapsed. 
Now,  the  paralysis  we  saw  then  on  a  vast  scale  is 
something  that  inevitably  goes  with  falling  prices. 
The  persistent  sinking  of  prices  is  nothing  less  than 
a  chronic  commercial  crisis,  and  so  we  shall  find  it 
yielding  the  same  results. 

NOTHING    IN    IT  FOR  THE    WORKINGMAN. 

The  question  of  honest  dollars,  therefore,  is  not 
merely  a  debtor's  question*  It  concerns  every  man 
who  is  producing  anything.  The  only  PEOPLE 
WHO  BENEFIT  by  an  appreciating  standard  arc 
those  who  hold  money  or  claims  for  money.  The 
PEOPLE  WHO  ARE  INJURED  arc  not  simply 
debtors,  but  every  man  who  is  producing  goods  and 


34  AN  HONEST  DOLLAR  IS 

trying  to  sell  them  for  money.  In  this  gigantic  strug- 
gle it  is  impossible  that  the  interest  of  the  working- 
man  should  be  altered  by  the  fact  that  he  receives 
advance  payment  for  his  product  in  the  form  of 
wages.  Much  has  been  made  of  the  fact  that  wages 
change  more  slowly  than  prices  of  commodities,  im- 
plying that  under  the  gold  standard  the  workingman 
gets  a  certain  benefit  during  this  interval.  But  let 
us  see  what  takes  place.  In  1893,  two  and  a  half 
months  after  the  beginning  of  the  crisis,  850,000 
MEN,  willing  to  work,  most  of  whom  had  families 
to  support,  WERE  THROWN  OUT  OF  EMPLOY- 
MENT. There  had  been  a  sharp  fall  in  the  prices 
of  everything  we  buy.  Wages  had  been  very  little 
affected,  yet  labor  got  its  share  of  the  burden  and 
got  it  promptly,  but  it  came  not  in  the  form  of  falling 
wages,  but  in  the  form  of  the  narrowing  of  the  field 
of  employment.  Not  lower  wages,  but  DISCHARGE 
is  the  first  effect  of  falling  prices  on  the  workingmen. 
After  some  time  the  fierce  competition  of  the  unem- 
ployed forces  down  wages,  and  labor  is  once  more 
set  to  work.  Therefore,  workingman,  be  no  cat's-paw 
for  the  money  lender!  The  prosperity  that  under 
the  gold  standard  you  are  supposed  to  enjoy,  from 
the  fact  that  your  wages  do  not  fall  so  rapidly  as 
prices,  is  but  a  banquet  of  sawdust. 

There  are  still  other  far-reaching  consequences  of 
our  falling  prices.  There  is  no  patriotic  American 
who  has  not  observed  with  anxiety  the  rise  of  vague 
discontent,  the  spreading  distrust  of  our  institutions 
and  the   growing    bitterness    between   classes  in  this 


THE  NOBLEST  WORK  OF  MAN  35 

country.  On  the  one  hand,  with  the  dissolving  of 
the  bonds  that  knit  group  to  group,  moneyed  people 
evince  a  strange  disposition  to  see  a  Marat  or  a 
Robespierre  in  whoever  disagrees  with  them,  and  to 
look  upon  the  plain  people  as  incipient  Jacobins;  on 
the  other  hand,  the  no  less  significant  willingness  of 
many  on  the  other  side  to  accept  the  parallel  and  to 
compare  our  time  with  that  just  before  the  French 
revolution.  This  ominous  tendency  I  once  attributed 
to  the  natural  evolution  of  our  industrial  system. 
Longer  reflection,  however,  convinces  me  that  no 
small  part  of  it  is  due  to  the  loss  and  irritation  result- 
ing from  a  slow  suffocation  by  falling  prices.  If  a 
mischievous  boy  pinches  the  tails  of  tabbies  peace- 
fully sleeping  before  the  fire  they  will  promptly  begin 
to  spit  and  claw  at  each  other.  So  with  our  pro- 
ducers. Angered  by  the  failure  of  business  calcula- 
tions and  by  the  unaccountable  fall  in  the  value  of 
his  products,  each  lias  turned  on  the  nearest  group 
and  engaged  in  a  struggle  with  it.  Laborers  and 
capitalists,  farmers  and  railroads,  have  been  jostled 
against  each  other  till  there  is  a  feeling  of  rancor 
aroused  that  bodes  ill  for  our  future. 

I  have  considered  the  ruinous  effects  of  the  gold 
standard.  What  compensation  is  there  for  it?  It  is 
said  by  the  gold  men  that,  whether  we  like  it  or  not, 
gold  has  by  perfectly  natural  evolution,  due  to  the 
preferences  of  the  commercial  world,  become  the 
principal  money  metal;  that,  therefore,  we  must  ac- 
cept it  and  make  the  best  of  it.  The  argument  is 
not  convincing,  however,  the   moment   we    discover 


3*6  AN  HONEST  DOLLAR  IS 

the  true  history  of  the  present  domination  of  gold. 
Yes,  gold  has  got  to  the  top,  but  it  has  been  helped 
there.  Silver  was  not  quietly  supplanted;  it  was 
KICKED  OUT.  If  the  practice  quietly  grew  up 
among  business  men  of  making  and  meeting  con- 
tracts with  gold,  why  was  it  necessary  to  pass  the 
demonetization  laws  of  187 1-3?  Did  the  railroad 
need  a  law  in  order  to  drive  out  the  stage  coach? 
Did  the  electric  light  ask  the  aid  of  government  in 
its  struggle  with  the  kerosene  lamp? 

Again,  the  gold  men  urge  that  their  standard  is 
surely  prevailing  in  Europe,  that  Austria  is  nearly  on 
a  gold  standard,  that  Roumania  has  adopted  it,  and 
that  the  formerly  bimetallic  members  of  the  Latin 
Union  seem  to  have  reconciled  themselves  to  the 
present  situation.  He  argues,  therefore,  that  we 
must  conform  to  the  general  practice.  The  going 
over  of  nation  after  nation  to  the  gold  standard  is, 
however,  AN  ARGUMENT  AGAINST  IT.  As 
regards  the  metric  system,  ever}'  nation  that  adopts 
it  is  a  new  reason  for  our  adopting  it;  on  the  other 
hand,  every  nation  that  goes  to  the  gold  standard 
and  enlarges  its  monetary  stock  of  this  metal,  instead 
of  furnishing  a  new  reason  for  our  going  over  to  it, 
gives  us  a  new  ground  for  REJECTING  it.  For 
two  or  three  nations  the  gold  standard  might  be  very 
just,  but  when  a  dozen  are  scrambling  for  the  scanty 
supply  of  that  metal,  every  new  nation  that  joins  in 
the  scrimmage  aggravates  the  injustice  of  the  gold 
standard.  The  increasing  strain  that  comes  with 
the  swinging  into  line  of  the  minor  countries  is  hist 
the  point  that  should  give  us  pause. 


THE  NOBLEST  WORK  OF  MAN  37 

WHAT  KIND  OF  DOLLARS  SHALL    WE  HAVE? 

If,  therefore,  it  is  agreed  that  the  gold  standard  is 
unendurable,  what  kind  of  dollars  shall  we  undertake 
to  have?  It  would  be  clearly  unjust  to  reinstate  the 
dollar  of  1873  as  it  was.  It  has  been  a  great  wrong 
that  the  dollar  has  appreciated  67  per  cent.  But  it 
would  be  another  wrong  to  depreciate  the  dollar 
down  to  its  former  purchasing  power.  Two  wrongs 
do  not  make  a  right.  On  the  other  hand,  we  are  not 
called  upon  to  keep  the  dollar  just  where  it  now  is. 
There  is  existing  a  vast  mass  of  debt,  incurred  all 
along  the  period  from  1873  to  the  present.  To  com- 
pel a  man  who  borrowed  the  dollars  of  1880  or  1890 
to  pay  the  dollars  of  1896  is  unjust.  On  the  other 
hand,  to  make  a  man  who  loaned  the  dollars  of  1890 
accept  the  dollar  of  1873  is  likewise  unjust.  If  it 
were  possible  to  find  the  typical  or  average  dollar  in 
which  these  billions  of  debt  were  incurred,  and  if  we 
could  go  back  to  that,  we  should  have  the  FAIREST 
SOLUTION  of  the  present  difficulty.  Just  what 
dollar  would  strike  the  average  for  our  debt — whether 
that  of  1889,  or  1890,  or  1891 — no  one  can  say. 
This  much,  however,  is  certain:  That  while  we  are 
not  required  to  go  clear  back  to  the  dollar  of  1873, 
we  are  not  called  upon  to  keep  our  dollar  at  its 
PRESENT  purchasing  power.  A  certain  moderate 
inflation  of  prices  for  a  brief  period  could  not  justly 
be  complained  of. 

OUR   I'ROIILRM. 

Here   then,  is  our  problem:     To  find  a  monetary 


38  AN  HONEST  DOLLAR  IS 

policy  that  shall  rescue  us  from  the  CRUEL  PINCH 
of  the  gold  standard  and  which  shall  not,  on  the 
other  hand,  cause  any  large  inflation  of  prices. 
Anything  lying  between  these  two  limits  is  better 
than  what  we  now  have,  and — as  a  perfectly  stable 
dollar  is  unattainable — therefore,  worthy  of  consider- 
ation. We  next  consider  the  possible  alternatives  to 
the  gold  standard. 

The  SOLE  REASONABLE  POLICY  seems  to 
be  to  enlarge  the  volume  of  money  by  returning  to 
the  system  of  bimetallism  that  prevailed  before  1873. 
Bimetallism  means  the  free  coinage  of  both  gold  and 
silver  into  full  tender  money  at  a  fixed  ratio.  This 
prevailed  in  the  United  States  from  1792,  in  France 
from  1803,  and  later  in  Greece,  Italy,  Switzerland 
and  Belgium,  the  nations  composing  the  Latin  Union. 
France  had  a  ratio  of  15-5-  to  1,  and  for  seventy  years 
during  all  the  tremendous  fluctuations  of  the  relative 
production  of  the  precious  metals  she  kept  gold  and 
silver  circulating  side  by  side.  The  partial  substitu- 
tion of  silver  for  gold  or  of  gold  for  silver  in  the 
money  of  France  pulled  back  the  commercial  ratio 
when  it  tended  to  depart  from  the  fixed  French  ratio, 
and  kept  its  oscillations  within  the   narrowest  limits. 

The  EFFECT  OF  BIMETALLISM  is  to  sup- 
port the  world's  business  on  a  combined  mass  of  gold 
and  silver,  which  fluctuates  less  than  either  metal 
alone.  Moreover,  only  the  two  together  can  give  us 
a  broad  enough  basis.  The  gold  man's  ideal  is  a 
narrow  foundation  of  gold  supporting  a  dizz}?  super- 
structure of  credit,  the  upper    stories  of  which  topple 


THE  NOBLEST  WORK  OF  MAN 


39 


down  whenever  a  financial 
earthquake  comes.  We 
favor  a  lower,  broader  and 
stabler  structure. 

The  fact  that  under  the 
ratio  of  15  to  i,  that  we 
had  for  forty-two  years, 
our   money  was   practically 


THEIK   IDEA. 


all  silver,  and  that  under  the  ratio  of  16  to  1,  adopted 
in  1834,  it  became  nearly  all  gold,  is  frequently 
brought  forward  to  show  that  bimetallism  won't  work. 


**HH>TJ£„ 


01  ic  IDEA, 


40  AN  HONEST  DOLLAR.  IS 

The  fact  shows  JUST  THE  OPPOSITE.  When 
two  bimetallic  systems  have  different  ratios  the  big- 
ger system  will  prevail  and  will  upset  the  smaller 
system  if  the  theory  of  bimetallism  is  true;  and  this 
is  just  what  happened.  We  had  the  little  system, 
and  so  paid  the  penalty  for  disregarding  the  bigger 
French  system  in  fixing  our  ratio.  It's  the  old  story 
of  the  wheelbarrow  colliding  with  the  locomotive. 

INTERNATIONAL  AGREEMENT. 

There  are  some  who  desire  bimetallism,  but  bid  us 
wait  until  we  get  an  international  agreement.  If 
there  were  any  show  of  getting  several  nations  to  open 
their  mints  to  both  metals  at  an  agreed-upon  ratio  we 
should  do  so.  Certainly  it  is  better  to  solve  the 
"money  problem  for  the  world  than  for  ourselves  alone. 
But  look  at  the  situation.  France  and  the  members 
of  the  old  Latin  Union  are  willing.  German}'  would 
join  if  England  would.  England  says  no.  For 
twenty  years  we  have  been  working  for  an  interna- 
tional agreement.  The  three  Commissions  we  have 
sent  to  international  monetary  conferences  have  come 
back  empty  handed.  England  blocks  the  way,  and 
England's  interest  is  with  the  gold  standard. 

It  is  not  rash  to  estimate  that  $2,000,000,000  of 
English  capital  is  loaned  in  America.  In  that  case 
the  i\  per  cent  of  annual  appreciation  of  gold  means  a 
tribute  of  $50,000,000  a  year  from  this  country  alone. 
With  her  vast  loans  to  Argentina,  Egypt  and  other 
borrowing  countries,  it  is  "safe  to  say  that  by  the  gold 
standard  ENGLAND  PROFITS  off  other  peoples 
not  less  than  $250,000,000  a  year.   Why  should  Eng- 


THE  NOBLEST  IVORK  OF  MAN 


41 


•/w««/>^ 


THE  NOBL  ES  T  WORK  OF  MAN  43 

lishmen,  then,  abandon  this  big  premium  in  order  to 
pull  our  chestnuts  out  of  the  fire  ?  They  know  full  well 
the  profit  of  the  gold  standard  to  the  creditor  nation  and 
are  frank  to  avow  it.  Our  gold  men  would  not  dare 
publish  here  the  arguments  of  their  English  brethren. 
It  would  let  the  cat  out  of  the  bag.  The  English  are 
a  great  people  because  they  are  never  swerved  from 
the  pursuit  of  their  national  interest  by  any  fiddle- 
faddle.     Let  us  profit  by  their  example. 

The  choice  is,  then,  BETWEEN  GOLD  AND 
INDEPENDENT  ACTION.  There  is  no  middle 
term.  The  hope  of  international  agreement  is  held 
out  to  us  as  a  wisp  of  hay  is  tied  to  a  pole — always  a 
little  ahead  of  the  donkey,  to  get  the  tired  beast  to  go 
farther.  Latterday  shouters  for  international  agree- 
ment are  not  sincere.  Scratch  them  and  you  will 
find  them  yellow  underneath. 

why  16  TO  I? 

But  the  question  is  asked:  "Why  16  to  I,  when 
the  conditions  are  so  changed?"  It  is  true  that  at  the 
present  moment  one  ounce  of  gold  bullion  exchanges 
for  nearly  thirty-two  ounces  of  silver  bullion.  That 
it  is  the  gold  that  has  gone  up  and  not  the  silver  that 
has  gone  down — as  can  be  proved  by  comparing 
prices  in  silver  and  gold  countries — does  not  alter 
the  fact  that  the  metals  have  drifted  apart.  What 
account  must  be  taken  of  that  fact? 

i  am  frank  to  say  that  if  we  were  starting  with  a 
clean  slate  it  might  be  advisable  to  adopt  a  higher 
ratio.      But  tins  has  nothing    to    do  with  the  case  in 


44  AN  HONES T  DOLLAR  IS 

hand.  Historical  causes  have  fixed  the  old  ratio  so 
firmly  in  the  minds  of  the  American  people  that 
there  is  no  hope  of  getting  up  enthusiasm  for  a  new- 
fangled ratio.  The  alternative  is  16  to  I  or  the  gold 
standard;  and  put  that  way  I  am  unreservedly  for  16 
to  1.  In  the  second  place,  a  new  ratio  would  compel 
the  recoinage  of  our  silver  into  bigger  dollars,  and, 
apart  from  the  expense,  would  mean  a  contraction  in- 
stead of  an  expansion.  Coinage  at  32  to  1  would 
CUT  OUR  SILVER  MONEY  IN  TWO  and 
bring  in  no  fresh  supply. 

"The  result,"  say  the  gold  men,  "of  coining  at 
16  to  1  when  the  metals  stand  at  32  to  1  will  be  the 
leaving  of  our  gold.  Silver  will  seek  us  because  it 
will  go  farther  here.  Gold  will  leave  us  because  it 
is  worth  more  elsewhere.  You  had  better  say  nothing 
of  bimetallism  or  ratio,  but  simply  declare  for  the 
silver  standard  with  a  dollar  of  37  ii  grains  as  a  unit." 

The  matter  is  by  no  means  so  simple.  The  true 
ratio  we  have  to  take  account  of  is  not  at  all  32  to  1. 
The  movements  of  the  metals  which  will  determine 
the  success  or  failure  of  our  bimetallism  depend  not 
on  the  momentary  exchange  ratio  of  gold  and  silver 
bullion  in  London,  but  upon  the  relation  of  the  pur- 
chasing power  of  silver  in  silver-using  countries  to 
the  purchasing  power  of  gold  in  gold-using  countries. 
Gold  has  appreciated  67  per  cent.  Silver  has  not 
depreciated,  but  is  everywhere  reported  to  be  able  to 
buy  as  much  as  it  ever  could.  The  ratio  of  32  to  I, 
therefore,  is  merely  speculative  and  does  not  express 
the  real  economic  relation   of  the  two  metals.     The 


THE  NOBLEST  WORK  OF  MAN  45 

REAL  VALUE — i.  e.,  the  respective  purchasing 
powers  of  gold  and  the  unappreciated  silver  of  silver 
countries — have  by  no  means  drifted  so  far  apart  as 
the  commercial  ratio  would  indicate.  If  the  silver 
unit  has  remained  the  same  in  purchasing  power, 
while  the  gold  unit  has  gained  67  per  cent,  the  ratio 
is  not  32  to  I,  but  27  to  1. 

Now,  what  is  the  force  we  rel}T  on  to  overcome  this 
real  divergence?  It  is  the  possession  of  $625,000,000 
of  gold  and  the  effect  upon  the  ratio  of  letting  a  part 
of  this  gold  go  to  the  gold-using  countries  and 
taking  a  much  larger  mass  of  silver  in  its  place.  We 
could  produce  a  tremendous  effect  upon  the  metals 
by  absorbing  a  large  mass  of  silver  and  letting  Europe 
have,  say,  $400,000,000  of  our  gold.  This  mass 
plumped  down  into  the  currency  of  the  gold  coun- 
tries would  have  an  amazing  effect,  not  only  in  stop- 
ping the  upward  flight  of  gold,  but  in  pulling  it  down 
toward  silver. 

It  is  sometimes  said  that  we  propose  to  double  at  a 
stroke  the  value  of  the  $4,000,000,000  of  silver 
money  in  the  world.  This  is  absurd.  The  silver 
coin  in  the  gold  countries  and  in  the  gold  and  silver 
countries  is  already  on  a  parity  with  gold  at  ratios  be- 
tween 15  and  16  to  1.  The  mass  of  silver  to  be  lifted 
in  purchasing  power  is  only  the  $1,845,000,000*  of 
the  silver-standard  countries.  Can  any  one  doubt  that 
without  losing  all  our  gold  the  currency  of  a  great 
nation  like  this  can  permit  so  extensive  a  substitution 
of  silver  for  gold  as  shall  pull  down  the  purchasing 
»  Report  ol  Director  of  the  Mint,!* 


4G  AN  HONEST  DOLLAR  IS 

power  of  gold  and  pull   up   the  purchasing  power  of 
silver  until  they  meet? 

THE  FLOOD  OF  SILVER. 

Approach  the  problem  in  another  way.  Where 
will  the  flood  of  silver  come  from  that  is  going  to  ex- 
pel our  last  penny  of  gold?  From  Europe!  The 
European  avalanche  of  silver  is  a  myth.  Their  $i,- 
300,000,000  of  silver  is  coined  at  15^  to  1,  and  every 
dollar  of  it  would  lose  three  cents  of  value  by  being 
"dumped"  upon  us  here.  Is  a  Frenchman  going  to 
bring  sixteen  ounces  of  his  silver  to  us  and  exchange 
it  for  one  ounce  of  gold — even  if  he  could  find  some 
one  to  swap  with  him — when  fifteen  and  a  half  ounces 
are  equivalent  to  one  ounce  of  gold  at  home?  The 
"flood"  can  come  only  from  the  silver  countries. 
Could  it  come  from  Mexico?  She  has  only  $55,- 
000,000,  and  could  spare  little  of  that.  From  South 
and  Central  America?  They  have  only  $42,000,000. 
The  inflow  of  silver  would  have  to  come  from  the  $1, - 
700,000,000  in  India  and  China.  Will  these  immobile 
nations  suddenly  project  one-third  of  their  money 
upon  us?  If  they  did,  what  would  they  take  back? 
Gold?  They  do  not  use  it  as  money.  The}*  would 
have  to  exchange  their  silver  for  American  GOODS, 
and  this  process  is  so  slow  that  it  would  take  years 
to  get  any  great  supply  of  silver  from  them.  More- 
over, as  regards  India,  since  the  stoppage  by  England 
in  1893  of  the  free  coinage  of  silver  there,  the  whole 
mass  of  her  money  has  begun  to  move  slowly  upward 
with  the  appreciating  gold  standard. 


THE  NOBLEST  WORK  OF  MAN  47 

But  how  about  the  annual  production  of  silver? 
Thanks  to  the  gold  reefs  of  the  Transvaal,  the  annual 
production  of  gold  has  all  but  overtaken  the  annual 
output  of  silver,  so  that  for  some  time  to  come  the  in- 
fluence of  one  will  cancel  the  other.  The  statement, 
dear  to  the  gold  men,  that  it  was  overproduction  of 
cheap  silver  that  broke  the  old  ratio  and  not  the  de- 
monetization of  1873,  is  shattered  by  the  following 
calculation  from  the  staunch  little  book  uOur  Silver 
Coinage:"*  "For  the  first  fifty  years  of  this  century, 
1S01  to  1850,  we  produced  100  cents  in  gold  to  172 
cents  in  silver.  In  the  twenty-five  years,  185 1  to 
1875,  we  produced  100  cents  in  gold  to  41  cents  in 
silver.  For  eighteen  years,  1876  to  1893,  we  pro- 
duced 100  cents  in  gold  to  114  cents  in  silver."  For 
the  years  1893  to  1896  the  world's  production  was, 
viz.  : 

Gold.  Silver. 

#157,000,000  $214,000,000 

1894 180,000,000  216,000,000 

303,1000,000  226,000,000 

The  idea  that  free  coinage  will  tempt  the  mass  of 
silver  plate  and  jewelry  into  the  melting  pot  is  too 
silly  to  need  comment.  Do  the  bureaus  and  tables 
go  into  the  stove  when  cord  wood  gets  dearer? 

There  was  once  a  mountain  climber  who  fell,  and 
just  as  he  thought  he  was  slipping  into  an  abyss  caught 
his  lingers  in  a  crevice  in  the  rock.  After  holding 
00  in  agony  till  all  his  strength  was  spent  he  gave 
himself  up  for  lost,  and  closing  his  eyes  let  go.  He 
landed  oo  a  broad  path  four  inches  below.  Now, 
I  >  John  A.  Grier. 


48  AN  HONEST  DOLLAR 

Uncle  Sam  reminds  me  of  that  traveler.  With  much 
sweat  and  anguish  he  is  desperately  holding  on  to 
the  gold  standard,  fearing  to  let  go  lest  he  drop  into 
the  abyss  of  50-cent  silver.  Very  likely  he  could 
stretch  out  his  toes  and  touch  firm  ground  of  silver 
without  once  letting  go  of  the  gold  standard.  But, 
in  any  case,  when  at  last  he  despairingly  lets  go  he 
will  land  lightly  on  solid  ground  just  a  few  inches 
below  his  feet. 

As  some,  however,  go  into  convulsions  at  the  mere 
thought  of  losing  our  gold  and  coming  to  a  silver 
standard,  let  us  pause  for  a  moment  to  consider  this. 
Gold,  we  have  seen,  gives  a  frightfully  dishonest 
dollar.  What  kind  of  a  unit  does  silver  give  to  its 
friends? 

The  index  numbers  for  twenty  Chinese  staple 
commodities  from  1873  to  1893  are: 


1873 

$1.00 

1880 

1881 

1882 

$0,96  1  1887 

....  $0.89 

1874 

91 

89 

96 

1.01 

1.05 

1.01 

97  1888 

88 

1875. .. . 

99  1889 

90 

1876 

1877 

1883 

1884 

9611890 

94 | 1891 

90 

87 

1878. . 

1885 

9311892 

88 

1879 

1886 

93  | 

Since  1893  the  tendency  has  been  slightly  upward. 

According  to  the  testimony  of  the  Mexican  minis- 
ter, prices  in  Mexico  have  remained  practically  un- 
changed. Silver-using  countries  HAVE  NOT  NOW 
AND  HAVE  NOT  HAD  a  depreciating  currency. 
Their  dollars  have  not  lost  in  value.  Their  money- 
yardstick  has  not  been  shortened.  It  is  the  GOLD 
COUNTRIES  that  have  had  the  dishonest  dol- 
lars, but  the  gold  advocates  have  sought   to    cover 


Ah  IT  REALLY  IS. 


THE  NOBLEST  IVORK  OF  MAN  51 

it  up  by  laying  the  divergence  of  gold  and  silver 
to  the  depreciation  of  the  latter.  Silver,  then,  is  A 
STABLER,  NOT  A  DEPRECIATING,  standard. 
But  its  weight,  its  bulk,  its  inconvenience  in  large 
payments!  Well,  the  invention  of  the  silver  cer- 
tificate obviates  this.  A  $1,000  silver  certificate 
weighs  no  more  than  a  $1,000  gold  certificate.  Even 
gold  is  so  bulky  and  heavy  that  we  have  had  as  much 
as  $140,000,000  of  gold  certificates  circulating  in- 
stead of  the  metal  they  represent.  As  regards  or- 
dinary circulation, where,  except  on  the  Pacific  slope, 
would  the  disappearance  of  gold  be  noted  by  the 
average  man?  I  ask  you  who  live  east  of  the  Rock- 
ies: How  long  has  it  been  since  you  saw  a  gold 
dollar? 

"  But  a  depreciated  currency,"  exclaim  some,  "  will 
hurt  the  poor  man!  Experience  shows  that  in  cheap- 
money  experiments  the  well-to-do  find  a  way  to  take 
care  of  themselves;  it  is  the  poor  man  who  bears  the 
brunt/'  Now,  this  is  quite  beside  the  mark.  It  is 
true  that  when  worn  or  counterfeit  or  debased  coins 
circulate  beside  gold  coins,  and  the  notes  of  shaky 
and  insolvent  banks  are  mingled  with  those  of  sound 
banks,  it  is  labor  that  gets  poor  money.  The  rich 
winnow  out  the  best  for  themselves.  But  this  has  no 
bearing  whatever  on  free  coinage.  If  gold  stayed 
here  it  would  be  because  it  was  not  a  whit  superior 
to  silver;  if  gold  left  us  we  should  have  a  uniform 
silver  money.  In  either  case  all  the  parts  of  our 
currency  are  on  a  par,  and  there  is  NO  OPPOR- 
TUNITY to  shove  "cheap  money"  on  to  the  poor 
man. 


52  AN  HONES  T  DOLLAR  IS 

But  silver,  even  if  stable  and  good  money,  is  not 
the  money  of  Europe.   Well,  what  of  it?   Let  us  see. 

THE  GOLD  "CRAZE." 

Gold  men  predict  all  manner  of  disaster  if  we  get 
out  of  touch  with  gold  nations.  Yet,  despite  our 
paper  basis,  we  managed  to  live  and  trade  with  Eu- 
rope from  1862  to  1879.  The  DEGRADING  SER- 
VILITY of  some  gold  men  to  European  example 
appears  in  these  words  in  a"  Sound  Money"  pamphlet: 
"  In  our  age  finance  rules  the  world  and  London  is  its 
throne.  *  *  *  Lombard  Street  is  the  focus  of  these 
exchanges, and  whatever  measures  values  in  Lombard 
Street  must  necessarily  determine  and  control  values 
wherever  industry  plies  the  plow,  the  pick,  the  ham- 
mer, the  shovel  or  the  yard-stick. 

"Whether  we  consent  or  not,  therefore,  whether 
we  approve  or  not,  as  long  as  the  world  has  Lombard 
Street  for  its  cjearing  house  just  so  .long  must  we 
conform  to  the  standard  of  value  there."*    - 

Could  madness  go  further? 

Parity  with  Europe  is  a  good  thing,  but  it  is  possi- 
ble to  pay  too  much  for  it.  Ought  our  American 
railroads  in  order  to  be  uniform  with  Mexican  rail- 
roads adopt  a  gauge  that  is  entirely  unsuited  to  the 
transportation  business  of  this  country?  And  if  we 
had  such  a  gauge  would  it  be  wise  to  keep  it  for  the 
sake  of  the  merchants,  importers  and  exporters  who 
ship  goods  across  our  Mexican  frontier? 

Less  than  one-fiftieth  of  our  business  is  done  with 
Europe.  Shall  we  accept  decay  and  paralysis  for 
the  whole  interior  of  this  gigantic  country  just  to  ac- 

*  Trenholm,  "The  People's' Money." 


THE  NOBLEST  WORK  OF  MAN  53 

commodate  the  bankers,  importers,  financiers,  deal- 
ers in  foreign  securities  and  company  promoters  of 
our  seaboard  cities  and  the  small  knot  of  men  in  the 
interior  cities  with  like  financial  interests?  We  re- 
spect their  protest,  but  THE  TAIL  MUST  NOT 
WAG  THE  DOG. 

A  FALSE  PLEA. 

**  But  we  have  so  much  silver  already,"  say  some; 
''$624,000,000  of  it!  Only  India  and  China  have 
more.  We  coined  only  8  million  silver  dollars  be- 
fore 1873,  and  since  then  we  have  coined  over  426 
million.  Haven't  we  done  enough  for  silver?"  This 
is  entirely  misleading.  The  third  statement  is  dis- 
honest. We  coined  8  million  silver  DOLLARS,  but 
84  million  dollars'  worth  of  full  legal  tender  SILVER 
prior  to  1873,  and  besides  this  we  had  as  much  as 
100,000,000  of  Spanish  and  Mexican  dollars  in  circu- 
lation, all  full  legal  tender.  But  aside  from  this  the 
great  point  is:  All  our  sil 
ver  before  1873  was  at  the 
silver  level,  while  the  mass 
of  silver  we  have  absorbed 


since  1873  has  all  been 
LIFTED  TO  THE 
GOLD  LEVEL  and  ap- 
preciates with  the  gold 
standard. 
By  the  parity  clause  in  the  law   of    1890  silver  has 


54 


AN  HONEST  DOLLAR  IS 


been  tied  to  gold,  and  every  dollar  of  it  has  appreci- 
ated with  the  gold  dollar.  It  is  as  "good  as  gold" 
because  it  is  AS  DEAR  AS  GOLD.  It  is  to  haul  this 
mass  up  the  steep  golden  incline  that  we  have  made 
issue  after  issue  of  gold  bonds.  All  that  it  has  done 
has  been  to  relieve  a  little  the  strain  on  the  world's 
gold.  It  has  not  cut  the  chain  that  binds  us  to  the 
ruinous  and   iniquitous  monetary  system   of  Europe. 


•HE  TWO    VOICES. 

But  the  50-cent  dollar!  Ah,  this  is  the  big  trump 
of  the  friends  of  robber  money.  If  this  cannot  take 
the  trick,  what  will?  And  yet,  surely  economists 
when  they  prophesy  immediate  50-cent  dollars  must 
exchange  winks. 

If  the  day  after  free  coinage  our  dollars  are  50- 
cent  dollars,  what  should  we  expect?  Why,  that  as 
a  dollar  will  get  only  one-half  as  much,  while  the 
goods  to  be  bought  and  sold  are  as  abundant  as  ever, 
it  will  be  necessary  to  use  twice  as  many  dollars  in 
buying  a  ham,  a  coat,  or  a  bicycle.   Prices  will  range 


THE  NOBLEST  WORK  OF  MAN 


y**i«*w 


spectacle  of  gold  holding  itself  aloof  in  proud  and  gloomy  iso- 

1-ition,  while  low  prices  are  tempting  it  back  into  circulation,  is  about 

.   to  imagine  as   unsupported    upright   walls   of    water.     That 

its  level  is  a  law  of  nature;  that  money  flows  where  prices 

.  is  an  economic  law. 


THE  NOBLEST  WORK  OF  MAN  57 

twice  as  high.  In  every  kind  of  transaction  twice 
as  many  dollars — coin  or  its  representatives — will  be 
used.  This  means  twice  as  many  dollars  in  the 
pocket,  the  till,  the  safe,  the  pay  car,  or  the  bank 
vault.  Unless  the  use  of  credit  is  enlarged — and 
that  is  the  last  thing  our  opponents  would  admit — 
the  money  of  the  United  States  would  have  to  be 
DOUBLED.  Only  a  circulation  of  $3,200,000,000 
would  give  us  a  chance  to  find  out  what  a  50-cent 
dollar  is. 

So  that  we  must  add  to  our  circulation  another 
$1,600,000,000,  which,  with  the  silver  required  to  take 
the  place  of  the  disappeared  gold, would  call  for  at  least 
$2,200,000,000  of  silver— about  TWO-THIRDS  of 
all  the  silver  coin  in  the  rest  of  the  world.  Moreover, 
only  $1,845,000,000  of  this  is  on  the  so-called  50- 
cent  level.  Consequently,  if  India,  and  China,  and 
Mexico,  and  South  and  Central  America,  sent  us  all 
their  money  and  themselves  went  back  to  barter, 
THEIR  UNITED  EFFORTS  could  not  give  us  a 
50  cent  dollar. 

Our  opponents  tell  us  that  the  day  after  free  coin- 
age our  gold  will  promptly  go  out  of  circulation  and 
there  will  be  an  appalling  contraction  of  our  currency. 
The  spectacle  of  gold  holding  itself  aloof  in  proud 
and  gloomy  isolation,  while  low  prices  are  tempting 
it  back  into  circulation,  is  about  as  easy  to  imagine 
as  unsupported  upright  walls  of  water.  That  water 
seeks  its  level  is  a  law  of  nature;  that  money  Hows 
where  prices  are  low  is  an  economic  law. 

The  pitch  of  folly  is  reached  by  the  holders  of  the 


58  AN  HONEST  DOLLAR  IS 

gold-vacuum  theory  when  they  tell  the  uninstructed 
that  while  there  will  be  only  half  as  many  dollars  to 
do  our  business  with,  these  dollars  will  be  "50-cent 
dollars."  This  implies  that  with  half  as  much  money 
prices  will  be  doubled — just  the  same  as  asserting 
that  if  you  pump  one-half  of  the  water  out  of  a  cistern 
the  water  will  be  twice  as  deep. 

GOLD  CONTRACTS. 

Some  people  are,  however,  worried  by  their  gold 
contracts.  "What  can  we  do,"  they  anxiously  say, 
"if  the  gold  leaves  the  country?  How  could  we 
meet  our  contracts?"  This  is  a  striking  case  of  con- 
fusion of  thought.  There  will  always  be  some  gold 
in  the  country,  as  there  was  during  the  paper  era, 
1862-79.  Remember,  too,  that  the  holder  of  a  gold 
contract  cares  not  for  gold,  but  for  GOLD'S 
WORTH,  and  under  free  coinage  I  assert  that  it  will 
take  LESS  of  the  fruits  of  toil  to  procure  the  gold  or 
the  gold's  worth  of  silver  to  satisfy  a  gold  contract 
than  it  will  if  we  ga  right  on  as  we  are.  The  re- 
lease of  our  gold  from  money  use  here  is  bound  to 
halt  the  rapid  appreciation  that  we  must  endure  if 
we  stick  to  the  gold  standard.  The  power  of  your 
silver  or  your  products  to  procure  silver  in  the  mar- 
kets of  the  world  will  certainty  be  greater  if  this  coun- 
try steps  over  to  the  silver  column  and  allows  her 
gold  to  pass  into  the  European  channels  of  trade. 

OBJECTIONS. 

Certain  objections  remain  to  be  examined. 
BANKERS.— It  is  claimed  that  the  bankers  form 


THE  NOBL  ES  T  I VORK  OF  MAN  5Q 

the  greatest  debtor  interest  in  the  country  and  yet 
oppose  free  coinage.  But  statistics  show  that  our 
national  banks  alone  owe  $400,000,000  less  than  is 
owing  to  them.  Besides  this  they  own  $430,000,- 
000  of  reserve.  The  interest  of  the  banking  class, 
therefore,  in  the  appreciation  of  the  gold  standard  is 
per  cent  of  $830,000,000,  or  over  $20,000,000 
annually.  I  am  a  bank  director  and  a  stockholder  in 
a  bank, and  as  such  my  interests  would  be  injured  by 
quitting  the  gold  standard;   but  I  must  tell  the  truth. 

BUILDING  AND  LOAN  STOCKS— -The 
building  and  loan  associations  are  held  up  for  pity  if 
the  2^  per  cent  annual  premium  on  money  ceases. 
It  is  forgotten  that  these  associations  lend  every  dol- 
lar to  their  own  members,  so  it  is  the  workingmen 
who  are  debtors  as  well  as  creditors.  The  two  in- 
terests therefore  balance  each  other. 

SAVINGS  BANKS  DEPOSITS.— Harrowing 
pictures  are  drawn  of  the  hardships  to  be  endured 
by  the  cessation  of  the  2k  per  cent  premium  on  the 
$1,800,000,000  of  savings  from  deposits.  But  they 
do  not  tell  us  how  much  of  this  is  deposited  by  the 
wage-earner;  nor  do  they  point  out  that  the  whole 
is  not  one-eleventh  of  our  total  debt,  and  is  far,  ever, 
from  equaling  the  burden  of  public  debt  that  bears  on 
all  citizens. 

PENSIONS. — We  are  accused  of  attempting  to 
injure  our  pensioners  by  stopping  the  increase  in  value 
of  their  pensions.  To  no  class  could  we  so  cordially 
concede  an  appreciating  dollar  as  to  our  veterans. 
But  the  pensions  amount  to  only  $141,000,000  aunu- 


60  A N  HONEST  DOLLAR  IS 

ally,  while  the  annual  interest  charges  on  the  total 
public  and  private  debt  in  this  country  is$i,  166,000,- 
000,  or  more  than  eight  times  as  much.  We  could 
better  afford  to  raise  the  face  value  of  pensions  20  per 
cent  every  year  than  to  endure  the  gold  standard  on 
their  account.  Those  who  faced  shot  and  shell  for 
their  country  will  never  stand  in  the  way  of  her  pros- 
perity. 

MERCHANTS  AND  BUSINESS  MEN.— -The 
merchants  and  business  men  are  assured  that  their  in- 
terest is  identical  with  the  banks  that  discount  their 
notes.  But,  surely,  this  is  false.  The  merchants  can 
have  no  interest  in  a  fall  in  prices  that,  intervening 
between  the  purchase  of  their  stock  and  their  disposal 
of  it,  tends  to  narrow  their  profits.  The  fact  that  the 
merchants  are  debtors  and  the  bankers  are  lenders 
shows  their  interests  to  be  ON  OPPOSITE  SIDES. 
The  fact  that  mercantile  loans  are  for  short  terms  does 
not  at  all  withdraw  them  from  the  inflation  of  an  ap- 
preciating dollar.  The  appreciation  on  a  debt  re- 
newed every  year  for  twenty  years  is  just  the  same 
as  the  appreciation  of  a  twenty-year  debt. 

MANUFACTURERS.— The  interest  of  the  man- 
ufacturer is  that  of  all  producers.  He  can  have  no 
interest  in  a  regime  of  falling  prices  that  perpetually 
upsets  all  of  his  calculations  and  makes  it  unsafe  for 
him  to  carry  raw  materials.  It  is  the  manufacturers 
of  Lancashire  competing  with  producers  under 
stable  prices  in  silver  countries  who  are  the  backbone 
of  the  bimetallic  movement  in  England.  The  com- 
petition of  the  Indian  and  Japanese  factories  cannot 


THE  NOBLEST  IVORK  OF  MAN 


61 


too  soon  show  our  man- 
ufacturers the  handicap 
they  are  under. 

WORKINGMEN.— 
The  workingman  is  told 
that  his  wages    will  re- 
main the    same,    while 
Jthe  prices  of  everything 
else  will  advance.   It  is 
hard  to    see    any    basis 
for    this   assertion.     On 
what     grounds   can    we 
exempt  one  commodity 
from  a  general  advance? 
Why  should  the  price  of  labor  be 
stationary  any  more  than  that  of 
potatoes  or  kerosene?  They  tell 
us  that  the   workingman   wants 
appreciating  money  because  his 
wages,  though  they  fall,  do  not 
fall  as  fast  as  the  prices  of  what 
^Ss  he  buys.   I  have  already  pointed 

out  that  this  trailing  of  wages 
>fj  behind  prices  does  the  working- 
man  no  real  good.  Low  prices 
first  result  in  SHUT-DOWNS 
and  give  hundreds  of  thousands 
of  workingmen  their  "WALK- 
ING PAPERS."  Later  the  burden  borne  by  their 
discharged  men  is  transferred  by  means  of  lower 
wages  to  the  general  body  of  wage-earners. 


MEXICANIZISOTHI 

DIET.    STOP  HIM" 


fi2  AN  HO  NEST  DOLLAR  IS 

But  this  is  not  all.  Even  if  you  keep  your  job  you 
gain  nothing.  If  wages  trail  after  prices,  there  are 
some  things  that  trail  after  wages.  House  rent,  fees 
of  doctor  or  lawyer,  taxes,  all  manner  of  salaries,  the 
transportation  charges  for  every  article  in  the  retail 
market — these  remain  on  the  former  level  after 
your  wages  have  fallen.  So  that  for  everything 
the  workingman  gets  from  the  classes  behind  him 
he  pays  more  than  he  ought  to.  We  have  only 
to  remember  that  many  of  these  payments  are  con- 
cealed in  the  prices  of  the  groceries  or  dry  goods  he 
buys,  to  perceive  that  lower  prices  at  farm  or  factory 
do  not  at  once  mean  cheap  groceries,  or  fuel,  or 
clothes,  or  furniture  for  the  workingman.  So  that 
the  wage-earner's  interest,  like  that  of  any  other  pro- 
ducer, must  always  be  not  with  the  APPRECIAT- 
ING gold  dollar,  but  with  the  HONEST  dollar  bimet- 
allism will  give. 

The  argument  that  the  workingman  can  grow 
fat  while  falling  prices  are  crushing  the  life  out  of 
his  employer  does  not  fit  easily  in  the  mouths  of 
men  who  have  always  told  the  workingman  that  the 
only  way  to  benefit  him  was  by  making  his  employer 
prosperous  by  a  protective  tariff. 

We  insist  that  this  whole  question  is  A  MATTER 
OF  JUSTICE — of  simple,  strict  and  elementary  jus- 
tice. The  American  wealth  producer  should  not  be 
the  object  of  mawkish  sentimentality  or  blubbering 
philanthropy.  The  bread  poultices  and  little  pills 
of  charity  he  abhors.  He  wants  NOT  ALMS,  BUT 
OPPORTUNITY,     To  the  well-meaning  men  who 


THE  NOBLEST  WORK  Oh  MAN 


03 


offer  him  help,  but  deny  him  justice,  he  says — as  said 
the  sturdy  Diogenes  to  Alexander:     "Get  out  of  my 

sunshine." 


^m 


*> 


&VK 'fl,* 


Philanthropic  Goldite:     '"Well,  my  friends,  I  am  scrry  to 
this  way.      What  cm  I  do  for  you?" 

Prod  Just  get  out  of  our  sunshine," 


see  you 


SILVER  CAMPAIGN  BOOKS. 

Shall  the  United  States  undertake  alone  the  Free 
Coinage  of  Sliver  at  the  ratio  of  SIXTEEN  TO 
OXE?  By  Richard  Lowrv.  The  most  complete  and 
exhaustive  argument  yet  published.  Paper,  272  pages,  25 
cents. 

A  Brief  in  the  United  States  High  Court  of  Justice: 
THE  PEOPLE,  Plaintiffs,  vs.  THE  GOLDBUGS, 
Defendants.  By  A.  D.  Warner.  The  latest  handbook 
on  the  silver  question  ;  pointed,  forcible,  convincing.  Paper, 
144  pages,  25   cents. 

The    Effects   of  the   Gold  Standard,  or  Bimetallisms 

Cateehism.      By    Dt.    W.    H.    Smith.     Tie   Silver   Knight, 
nator  Stewart's    paper,    says:     "No    writer   on    the  money 
question  has  more  clearly,  accurately,    concisely    and  truth- 
fully   described    what    money  is,  its  necessities  to  civilization 
id    the    disasters   of    the    gold    standard,    than    Dr.  Smith." 
-■)0  pages,  25  cents. 
The    Modem     Banker:      A    Story    of    his    Rapid  Rise  and 
»erous  Designs.     By  James  B.  Goode.     In  the  form  of  a 
I,   this    book    gives    a    surprising  array  of  startling  facts 
about    the   banking    combine    which    is  now  fighting  the  free 
•    reform.     Every  point  is  well  taken,  and  the  proof  of 
irtion  is  given  in  full.     Paper,  1S0  pages,  25  cents. 
Illinois  Currency  Convention.     The   official   history  of  the 
Illinois    Democratic    convention    of  June,    1895,  including   a 
ilver   speech    by    William   J.    Bryan.     Edited  by 
rles  R.  Tuttle.     Paper,  177  pages,  25  cents. 

The    N<  u    Democracy    and    Bryan    its   Prophet.      By 

R.   Tuttle.     A  campaign  text  book  for  1896.     Paper, 
,  75  cents  a  dozen. 
Honest   Dollars.     By  Prof.  Edward  A.  Ross,  of  the  University 
Illustrated.     Paper, 64  pa  its  a 

Th«   White  Slave,    -  I  l",  by  Mi>s  Helen  L. 

f    Wellesley  College.     A    storv    of    today,  with   a 

of    j>ri<<-.    of   ;i    full   get    on 

il  terms  to  ayen  tiers  and  clubs. 

CHARLES  H.  KERR  &  COMPANY,  Publishers, 

56  Fifth  Ave.,    CHICAGO. 


HISTORY  OB 


Monetary  Svstems 

B.  C.  t       -A.  D. 

As  Drawn  from  their  Laws,  Treaties,  Mint  Codes,  Coins,  Archae- 
ological Remains,  and  other  Authentic  Sources. 

Bu  ALEXANDER  DEL  MAR,  M.  E. 


PRESS    OPINIONS: 

He  who  masters  Mr.  Del  Mar's  book  will  know 
more  of  monetary  systems  than  999  men  out  of  a 
thousand. — Financial  News,  London,  May  25,  1895. 

As  an  authority  on  Monetary  Systems  this 
work  deserves  to  rank  high.  It  is  in  fact  an  en- 
cyclopaedia on  the  subject,  and  no  one  who  is 
making  a  study  of  this  important  matter  can  afford 
to  be  without  it. — New  York  Herald,  June  2,  1895. 

Mr.  Del  Mar  ranks  high  as  a  student  and  is  one 
of  the  ablest  writers  on  money.  His  work  is  full  of 
exact  facts  eminently  pertinent  to  the  discussion  now 
in  progress.  —  Chicago  Inter-Ocean,    May  25,  1895. 

Alexander  Del  Mar,  the  authority  on  precious 
metals  and  their  history  as  money,  has  published 
in  this  country  the  history  of  monetary  systems 
which  he  published  about  a  year  ago  in  England. 
It  is  a  critical  and  complete  record  of  actual  exper- 
iments in  money  made  by  the  various  States  of  the 
ancient  and  modern  world.  This  work  is  of  great 
importance,  especially  at  this  time,  and  its  recep- 
tion in  this  country  will  doubtless  be  as  warm  as 
its  welcome  was  in  England,  since  Mr.  Del  Mar 
has  long  been  an  American  of  great  prominence  in 
this  field  of  thought.  The  work  is  especially 
adapted  to  the  need  of  the  American  people  at  this 
day. — Indianapolis  Sentinel. 


444  large  pages,  complete  index.    Beautifully  printed  and 
Sent,   expressage  prepaid,  to   any  address   in 


4  well  bound.    . 

J  the  United  States  on  receipt  of  $2.00,  and  as  the   Denver 

V  News  remarks,  it  is  well  worth  that  sum. 

1  Catalogue  of  other  books  mailed  free. 

It  Charles  H.  Kerr  &  Company,  Publishers,  56  Fifth  Ave.,  Chicago 


